OPEC sees oil supply surge from rivals, countering its cuts

OPEC on Wednesday raised its forecast for non-member oil supply this year to almost double the growth predicted four months ago as higher prices spur U.S. shale drilling, offsetting OPEC-led output cuts and a collapse in Venezuelan production. In a monthly report, the Organization of the Petroleum Exporting Countries said non-OPEC producers would boost supply by 1.66 million barrels per day in 2018. That was the fourth straight rise from 870,000 bpd forecast in November.

“For 2018, higher growth is expected on the back of the projected increase in U.S. shale production following a better price environment not only for shale producers but also for other countries such as Canada, the UK, Brazil and China,” OPEC said of the outlook for non-OPEC supply. This would lead to “a higher quarterly distribution throughout the year with a record-high level projected for the fourth quarter”, OPEC said.